Can You Put a Price on Good Teaching?

Feb 22, 2011

Economist Eric Hanushek has spent years researching education and the economy. He's recently come up with an (admittedly crude) formula that claims to pin down the monetary value of individual teachers as it relates to the United States' gross domestic product (GDP). Some professionals, though, question Hanushek's method of measurement, claiming it to be too narrowly focused to really judge the good a teacher does.

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By Eric Garneau

Money Matters

It sounds like common sense when you think about it: good teachers produce good students. Good students tend to excel in further academic endeavors, land good jobs and make more money. Therefore, good teachers lead to economic benefit. That seems a very vague sentiment, though. Can a teacher's value really be monetized?

According to Eric Hanushek, yes it can. Hanushek recently published a study entitled 'The Economic Value of Higher Teacher Quality.' In it, he proposes a way to assign actual dollar amounts to teachers' performances. His idea hinges on two premises: that certain teachers have been shown to consistently produce students with high test scores, and that the economic benefit to students with high scores has a positive effect on the national economy.

Report Cards for Teachers

Given that, Hanushek says, we can 'grade' teachers based on what they contribute to the national economy. The results are pretty shocking: according to Hanushek, assuming a class of 25 students, the best teachers contribute half a million dollars a year to the economy via their students' future earnings and productivity.

Something else to consider is the significant disparity between teachers who perform well and those who perform badly. According to Hanushek in a January 2011 interview with NPR, the best teachers can impart roughly a year and a half worth of knowledge in an academic school year, while the worst cover only half a year's content. That means that, across the same grade, some students can end up with one full year's knowledge and ability more than their peers. It also means that, while the best teachers contribute half a million to the economy each year, the worst take away from it.

money pile stack

What's to be Done?

That leads to perhaps the most controversial part of Hanushek's study. In his paper, he recommends replacing the bottom-performing 5-8% of teachers and replacing them with average educators. He says if that were accomplished, the U.S. GDP would grow by 100 trillion dollars in the next 80 years. Hanushek doesn't spell out just how schools would weed out the worst teachers, but it would involve looking at test scores both within a school year and across many years.

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Of course this method has its share of critics. NPR reports that schools in Los Angeles attempted to grade teachers via their test scores, although they didn't really take action with their data. However, the Los Angeles Times acquired the information and published it, names and all. This led to protests by teachers, who were understandably outraged at seeing their name next to a judgment of their competency, such as 'average' or 'least effective.'

Test scores are only one variable by which to measure a teacher's prowess, and a potentially uneven one at that. Hanushek counters that his method involves looking only at relative improvement within a year of students under a given teacher. That way, noted issues that affect education - particularly economic and social strata - should have no bearing. In addition, by looking at several years of data, teachers tend to consistently show the same results, whether scores improve, stay the same or decline.

teacher classroom

Of course teachers do lots of things besides present their students with standardized tests. Hanushek's method has no way of knowing, for instance, what kind of rapport teachers build with their charges, or any kind of emotional impact they might make. On the other hand, one might counter that there are other professions in which adults can make a difference in students' lives that don't involve teaching, such as counseling.

And perhaps the key issue that Hanushek is addressing: unlike many professions, there's no real objective standard by which to measure teacher performance. NPR's piece on Hanushek ends with a teacher wishing for some gauge to tell whether an educator is really performing as he or she should. It's entirely possible that Hanushek's proposal doesn't provide the right method to do that. However, it does take a step in that direction. Besides, if Hanushek is right to frame this discussion in trillions of dollars, it would be a mistake to ignore it completely.

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